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If 2017 posed problems for feds, 2018 could be worse with attacks on pay, benefits

President Trump speaks during a meeting with Republican members of the Senate about immigration in the Roosevelt Room of the White House on Jan. 4. (Alex Wong/Pool via Bloomberg News)

By Joe Davidson

Columnist

January 5, 2018

If 2017, with President Trump’s hiring freeze and political machinations, posed difficulties for federal employees, 2018 could be worse.

They did get a 1.9 percent pay raise this year, but now administration officials are considering a wage freeze and are attacking government data indicating that federal pay lags far behind that of the private sector. Don’t forget White House and congressional Republicans’ proposals to cut retirement and health-care benefits. They weren’t approved last year, but they remain poised for takeoff.

“The administration and many in Congress appear to have made a race to the bottom a priority,” said Jessica Klement, legislative director of the National Active and Retired Federal Employees Association. “This not only unduly harms federal employees and retirees, but also the taxpayers and communities they serve.”

The latest development is the Trump administration’s intrusion into the long-running debate over comparisons of government and private-sector pay.

While Republican politicians and conservative thinkers argue that many federal staffers are overpaid compared with other workers, federal unions and their Democratic supporters point to data released by the Federal Salary Council. In 2016, the council, using Labor Department surveys, determined that federal employees are paid 34 percent less on average than private-sector counterparts — a finding in line with previous annual reports.

Right-wingers have blasted those reports. With Republicans in control of the White House and Congress, those attacks carry a bigger punch.

The most recent example was the report issued by the President’s Pay Agent. The “agent” is really three people — Labor Secretary Alex Acosta, Office of Management and Budget Director Mick Mulvaney and Office of Personnel Management acting director Kathleen McGettigan.

Although issued a few days before Christmas, the report carried a lump of coal for feds. The pay agent expressed “major methodological concerns” about the way the pay gap is estimated. The agent’s three members argue the calculations exclude the value of employee benefits and “fail to reflect the reality of labor market shortages and excesses.”

“Ultimately, we believe in the need for fundamental reforms of the white-collar Federal pay system,” the officials added in a memorandum for the president included in the report. “We believe it is imperative to develop performance-sensitive compensation systems that will contribute to a Government that is more citizen-centered, results-oriented, and market-based.”

Rejecting the 34 percent gap, the pay agent said, “An April 2017 Congressional Budget Office (CBO) report echoes the findings of many academic economists in identifying a significant overall compensation gap in favor of Federal employees.” According to the CBO, “Overall, the federal government paid 17 percent more in total compensation than it would have if average compensation had been comparable with that in the private sector, after accounting for certain observable characteristics of workers.”

Defending the 34 percent determination, National Treasury Employees Union President Tony Reardon, who is a council member, said, “We stand by the methodology used by the Department of Labor and will push back against any attempts to use a flawed analysis as the pretext for cutting federal employee salaries.”

The problem with CBO’s finding, according to the American Federation of Government Employees (AFGE), is “the federal pay system does not assign salaries according to ‘observable characteristics’ of workers”; It assigns salaries by job duties and qualifications,” Jackie Simon, AFGE’s policy director and a council member, said by email. “Thus, women and men, African Americans, whites, Latinos and Asian Americans; young and old, gay and straight and those with four-year degrees and two-year degrees are all paid the same salary if they have the same job. There is considerable pay discrimination among people with similar ‘observable characteristics’ in the private sector, and the federal government should be proud that it has a pay system that avoids that kind of discrimination.”

Among the academic economists the pay agent cited is James Sherk. He was with the right-wing Heritage Foundation until he became a domestic adviser to Trump last year. While with Heritage, Sherk proposed several measures that would cut federal compensation. Now, he is in position to advance those and similar ideas from a place of power.

For example, quoting an administration budget document, a summary released by Sen. Claire McCaskill (Mo.), the top Democrat on the Senate Homeland Security and Governmental Affairs Committee, says: “ ‘Per governmentwide guidance, no civilian pay raise is included in the recommended level for the FY 2019 Budget.’ ”

Fighting back, 95 House Democrats urged House leadership to oppose cuts in federal compensation. “As you are aware, federal employees and retirees have had their pay and benefits cut by $182 billion since 2011,” said their December letter to House Speaker Paul D. Ryan (R-Wis.) and House Minority Leader Nancy Pelosi (D-Calif.).

“Enough is enough,” Democratic Reps. Gerald E. Connolly (Va.), Jamie Raskin (Md.) and Elijah E. Cummings (Md.), organizers of the letter, said in a statement. “The federal workforce should be thanked for their honorable service, not treated like a piggy bank.”

Thanking the Democrats for their letter, AFGE President J. David Cox Sr. said feds “are earning 6.5 percent less today than they did at the start of this decade, even as costs for health care, groceries, and other expenses continue to rise. Federal workers can’t afford more cuts to their pay and benefits.”

“We are preparing for the fight of our lives in 2018 … ,” added Randy Erwin, president of the National Federation of Federal Employees. “We expect Congress and the White House to be coming after federal workers with guns blazing.”

Joe DavidsonColumnist Joe Davidson covers federal government issues in the Federal Insider, formerly the Federal Diary. Davidson previously was an assistant city editor at The Washington Post and a Washington and foreign correspondent with the Wall Street Journal, where he covered federal agencies and political campaigns. Follow